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Since Congress passed the One Big Beautiful Bill Act (OBBBA) in 2025, the question of whether or not you qualify for student loan forgiveness after 20 years has become more complicated.
Before you can answer the question “am I eligible for student loan forgiveness,” you have to answer the questions, “am I enrolled in a loan repayment program?” and “what kind of loan repayment program am I in?”
The seismic changes introduced with the OBBBA should be reviewed and understood by everyone who either has a federally subsidized student loan or is thinking about getting one.
Time is of the essence. Deadlines to transfer from a sunsetting repayment program to a new program are quickly approaching.
Are student loans automatically forgiven after 20 years?
The short answer is no.
If you have a student loan and you want it to be forgiven, you have to enroll in — and be accepted by — a forgiveness program.
Once you’re in the program, you need to show that you have made the requisite on-time payments.
For the majority of students, only federally subsidized loans are eligible for forgiveness. Private student loans are not. And though some plans that offered 20-year forgiveness are still available, those 20-year forgiveness plans will be sunsetted by 2028 with limited exceptions.
Which plans forgive student loans after 20 years?
For new borrowers as of July 2026, there is no plan that forgives debt after 20 years. The Public Service Loan Forgiveness (PSLF) program forgives loans after 10 years, but you have to work in an approved public service job and make regular payments.
In 2010, a “new” Income-Based Repayment (IBR) plan was created a 20-year timeline for forgiveness. To qualify for forgiveness at the 20-year mark (240 monthly payments), you had to be a “new borrower” on or after July 1, 2014, meaning you had no outstanding federal student loan balance when you took out new loans after that date.
Then in 2012, President Obama ordered the Department of Education to create the Pay As You Earn (PAYE) plan, which also had a forgiveness timeline of 20 years or 240 monthly payments. Payments were also capped at 10% of your annual income.
In 2023, the Biden Administration launched the Saving on a Valuable Education plan (SAVE), which reduced payments to 5% of discretionary income and shortened the forgiveness timeline to 10 years. But this effort was blocked by court injunctions and was ultimately overturned by a federal appeals court.
In 2025, Congress decided to simplify the federal student loan program and sunset the programs that offer 20-year forgiveness. They will be fully replaced with the Repayment Assistance Plan (RAP) and the Tiered Standard Plan (TSP) by 2028. RAP does include a forgiveness provision but only after 30 years of payments. The Tiered Standard Plan is not a loan forgiveness program.
Repayment/Forgiveness PlanAvailable Status Before OBBBAAvailable Status After July 1, 2026Timeline to ForgivenessPayment Calculation MetricRepayment Assistance Plan (RAP)❌ Not created yetActive (The primary new income-driven option for new loans)30 Years1% to 10% of Adjusted Gross Income (AGI); flat $10/mo minimum; minus $50 per dependentIncome-Based Repayment (IBR)ActiveActive (Retained via statutory law only for existing borrowers)20 Years (borrowers after 2014) or 25 Years (older borrowers)10% or 15% of Discretionary Income (depending on borrow date)Saving on a Valuable Education (SAVE)Active (Biden-era flagship plan)❌ Terminated (Blocked by federal court order; borrowers given 90 days to exit)10 to 25 years (Defunct)5% to 10% of Discretionary Income (Defunct)Pay As You Earn (PAYE)Active⚠️ Sunset Phase (Closed to new enrollees; completely eliminated by July 2028)20 Years (Grandfathered only)10% of Discretionary IncomeIncome-Contingent Repayment (ICR)Active⚠️ Sunset Phase (Closed to new enrollees; existing Parent PLUS must use it by 2028)25 Years (Grandfathered only)20% of Discretionary IncomeTiered Standard Plan❌ Legacy 10-Year Standard PlanActive (The primary new fixed-payment option)10 to 25 Years (scaled based on total loan balance)Fixed monthly installments
Do I have to apply for 20-year student loan forgiveness?
To get into a federal loan forgiveness program, you must enroll in an eligible federal repayment plan or verify your employment through the official Department of Education portal. The federal government does not automatically enroll you into a program.
If you took out student loans after July 1, 2026, you are ineligible for a 20-year repayment plan. You are, however, still eligible for the new RAP plan, which provides forgiveness after 30 years.
If you are already enrolled in the PAYE plan, you can stay in that plan until it sunsets on July 1, 2028, but unless you take action to transfer into a 20-year IBR plan, your loan provider may automatically enroll you in the new Tiered Standard Plan, which does not offer loan forgiveness.
In order to stay eligible for 20-year forgiveness, people enrolled in the PAYE plan must apply to the Income-Based Repayment (IBR) plan by submitting a plan change request through the Federal Student Aid portal. If you are already eligible for PAYE, you will automatically retain your 20-year forgiveness schedule under the “New IBR” rules.
Because of separate administrative changes following the SAVE plan litigation, eligible SAVE legacy borrowers must enroll in PAYE before July 1, 2027, and then enroll in the new IBR plan before PAYE sunsets in 2028 in order to stay on a 20-year repayment plan.
The bottom line
Congress did away with the 20-year window for income-based loan forgiveness for new borrowers in 2025. Borrowers who were on a 20-year repayment plan before July 1, 2026 may be able to keep their 20-year forgiveness if they transfer into an IBR plan before July 1, 2028.
The Higher Education and Workforce Development Subcommittee Chairman, Burgess Owens (R-Utah), said when the section of the OBBBA that covers student borrowing was being debated in committee that the law would hold schools accountable for student outcomes and restore market incentives in higher education.
It is certainly true that the cost of student borrowing is higher now. According to Victoria Jackson of The Education Trust, a national nonprofit education advocacy organization, “The One Big Beautiful Bill Act (OBBBA) represents the most sweeping rollback of federal student aid and borrower protection in a generation.”
If you aren’t already enrolled in a 20-year forgiveness program, now is the time to see if you are eligible.
Brooklyn-based financial journalist Will Kenton has over a decade of experience covering the intersection of money, economics and culture. Specializing in investing, personal finance and retirement planning, his work has appeared in Investopedia, AP News, Business Insider and TIME Stamped. While at Investopedia, Will was the creative force behind the Anxiety Index, a proprietary tool used to gauge investor sentiment. His expertise is rooted in behavioral economics — a field he explored as associate editor of the New School Economics Review — and he aims to help readers navigate the “predictable irrationality” that influences financial decisions. Will holds a BA from Ohio University, an MA in economics from The New School and a Ph.D. in English literature from NYU. Beyond his financial career, he is also an award-winning playwright featured in the Red Bull Theater’s annual festival.
